The pace of purchases of Canadian securities by foreign investors slowed in August, with most of the investment focused on the bond market.
Statistics Canada said Monday non-residents bought a net $7.9 billion worth of securities during the month, down from $12.1 billion in July.
Economists had expected foreign purchases to total $10 billion in August.
The federal agency said foreigners added $6 billion of Canadian bonds to their portfolios in August, the largest investment in three months. The purchases were mainly of U.S. dollar-denominated new issues by federal government enterprises and provincial governments.
The federal agency said foreigners added $6 billion of Canadian bonds to their portfolios in August, the largest investment in three months. The purchases were mainly of U.S. dollar-denominated new issues by federal government enterprises and provincial governments.
“These purchases totalled $31.6 billion for the first eight months of 2011,” it said. “However, this amounted to less than half of the inflows recorded over the same period in 2010, largely reflecting reduced foreign investment in federal bonds.”
Non-residents also bought $1.6 billion of Canadian money market instruments in August, as well as $306 million worth of Canadian securities.
Meanwhile, Canadian investors purchased a net $2 billion in foreign securities during the month. The purchases were mainly of securities, totalling $3.7 billion.
Canadians sold $1.4 billion in foreign bonds in August, bringing the total since the start of 2011 to $10.8 billion. “U.S. government securities again led the reduction in holdings of foreign bonds.” Statistics Canada said. “Long-term interest rates in the United States have declined each month
since February to reach levels last seen at the end of 2008.”
SOURCE: http://www.canada.com/story_print.html?id=5561327&sponsor=
since February to reach levels last seen at the end of 2008.”
SOURCE: http://www.canada.com/story_print.html?id=5561327&sponsor=
1 comment:
Foreign investors slowed their purchasing of Canadian securities in August. They bought a net worth of $7.9 billion worth of securities this month, which is down from the $12.1 billion figure in July. The expected foreign purchases were to be about $2 billion higher. On a positive note, the purchase of Canadian bonds is going up. Foreigners added $6 billion to their portfolios which is a 3 month high. However, in 2010 the inflows were recorded to be double the inflows it is currently at in 2011. This may be caused by the lowering American long-term interest rates which are at a rate that has not been seen since the end of 2008. Once again, investors are choosing to invest in the U.S. over Canada. This reflects a continued belief in American stability over that of Canadians which continues to impact us negatively. It is important for the Canadian government to welcome trade and investments by showing the world that Canada is a safe place to invest their money.
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